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The IRS announced February 24th, that States affected by the recent disasters (California, Alabama, and Georgia) will have until October 16th, 2023 to file various Federal Individual and Business Tax returns and to remit payments.  California has now also conformed to the IRS postponement of filing and payment.

This is applicable to any 2022 income tax returns, normally due on March 15th, April 18th and May 15th. It also applies to payments and filings for the returns:

  • Quarterly Payroll Tax Returns and Payments- normally due January 31st and April 30th
  • Excise Tax Returns- normally due January 31st and April 30th

In addition, penalties on payroll and excise tax deposits due on or after December 27, 2022, and before January 11, 2023, will be abated if the tax deposits were made by January 11, 2023

This federal extension to pay by October 16th also applies to the following:

  • IRAs and Health Savings Accounts Contributions
  • Quarterly Estimated Taxes:
    • 2022 Q4- normally due January 17th
    • 2023 Q1- normally due April 18th
    • 2023 Q2- normally due June 15th
    • 2023 Q3- normally due September 15th

As of 3/7 we have confirmed that neither interest NOR penalties will be accrued on any IRS or CA payments made post original due date. 

Covered disaster areas affected by severe winter storms, flooding, landslides, and mudslides includes: 

Alameda, Alpine, Amador, Butte, Calaveras, Colusa, Contra Costa, Del Norte, El Dorado, Fresno, Glenn, Humboldt, Inyo, Kings, Lake, Los Angeles, Madera, Marin, Mariposa, Mendocino, Merced, Mono, Monterey, Napa, Nevada, Orange, Riverside, Placer, Sacramento, San Benito, San Joaquin, San Luis Obispo, San Bernadino, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, San Diego, San Francisco, Siskiyou, Solano, Sonoma, Stanislaus, Sutter, Tehama, Trinity, Tulare, Tuolumne, Ventura, and Yolo, Yuba

Rose, Snyder and Jacobs position on the 3/15 and 4/15 deadlines:   In spite of the relief spelled out above – we see areas of concern that the IRS (and California to a lessor degree) that have not addressed.   One of these is that an extension may very well be able to preserve the option for superseded returns which are much less expensive than an amended return.  Thus, for entities such as 1065, 1120 and 1120S, we will be extending all returns.    For some individuals we may be able to safely rely on the relief above but in many cases, we feel it is prudent to file an extension.

In all cases – communication and cash management will be very important.  We recommend that if payments are indeed deferred, that cash will need to be properly managed, in order to send in several payments on October 16th.   Some of our clients may prefer to get a few of those payments out of the way, early.  Keep in mind this will take some juggling and coordination.  As always, if you have any questions or concerns on this, please don’t hesitate to give our office a call.

P.S. We have a model for smoothing the path to your booming financial and tax compliant future. Find out how that could apply to you by clicking here to schedule your free one on one call with one of our partners today!

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